Health care plan called bold, foolish

PREVENTION: Gov. Arnold Schwarzenegger has said that providing universal insurance may help to hold down demand for costly emergency room care. FILE PHOTO: CHAS METIVIER, THE REGISTER

By the numbers

6.5 million: Uninsured Californians

60: At least this many emergency rooms have closed in the past decade – closures said to been driven by the cost of treating uninsured patients.

$1,186: The "hidden tax" an average family pays in extra annual health insurance premiums to cover the uninsured, according to the New America Foundation.

$445 million: National, direct medical cost of treating chronic illnesses such as cardiovascular disease, cancer and diabetes, according to the Centers for Disease Control and Prevention.

At a glance

Gov. Arnold Schwarzenegger unveiled a health care plan Monday that he said provides a way for private entities to help insure the 6.5 million uncovered Californians.

Patients: All Californians, including those here illegally, must have health insurance. Access to Medi-Cal and other programs will be expanded for low-income families, and a state fund will provide financial assistance to help pay for coverage.

Insurers: Cannot deny coverage based on health or age. Expected to swell private rolls by 4 million to 5 million patients. Must put 85 percent of premium revenue into patient care.

Employers: Those with more than 10 employees must either provide health care or pay 4 percent of their payroll into a state insurance fund. Must allow employees to fund pre-tax health savings accounts.

Providers: Hospitals pay 4 percent and doctors pay 2 percent of revenues into a state insurance fund. In exchange, they will see a $10 billion to $15 billion jump in revenue, based on the increase in insured patients and a $4 billion boost in the amount of Medi-Cal payments.

Low-income families: Expands access to Medi-Cal and other programs, and offers financial assistance to pay for coverage.

More

SACRAMENTO - Gov. Arnold Schwarzenegger's sweeping, $12 billion health care plan was met with as much praise as criticism Monday, with Democrats and some industry experts calling it bold while Republicans and doctors labeled it costly and foolish.

The governor's plan is to provide health insurance to an estimated 6.5 million uninsured by shaking up the entire health care system. Schwarzenegger says his plan would cost everyone but also benefit everyone - including illegal immigrants.

Businesses with more than 10 employees would provide insurance or pay into a fund for the uninsured. Doctors and hospitals would also contribute but would receive higher reimbursement rates. Insurance companies would be required to spend 85 percent of their premiums on health care, but they'd receive millions of new customers.

All residents would pay for some of their health care, but they would be protected for the future.

"Everybody is left with a better deal here," Schwarzenegger said.

The plan is the second of its kind in the nation. Massachusetts adopted one last year.

Sen. Lou Correa, D-Santa Ana, who led an effort to insure Orange County's 80,000 uninsured children as a county supervisor, said he was encouraged that the governor's plan includes a provision to insure all of California's children.

Democratic leaders in both houses, as well as several industry insiders, including the president of Blue Shield of California, praised the plan as inventive and pledged to work with the governor to flesh out details.

"The governor's plan is bold, comprehensive and visionary," Bruce Bodaken of Blue Shield said in a statement. "Taking each part separately, there's something for everyone to hate, but taken as a whole, there's a lot to like."

Dr. Richard Frankenstein, a Garden Grove lung specialist who is president-elect of the California Medical Association, objected to Schwarzenegger's requirement that doctors pay 2 percent of their income into a state fund for uninsured residents.

Schwarzenegger said the payment would be balanced by higher Medi-Cal reimbursements and the larger number of insured customers.

Republicans said tax dollars shouldn't go to help cover uninsured illegal immigrants, estimated at 1 million people by the state.

Schwarzenegger said the federal government requires medical care for illegal immigrants. Instead of providing them with the most expensive - at emergency rooms - the state should provide care efficiently and with less expense through insurance programs, he said.

But Senate Republican Leader Dick Ackerman of Irvine said uninsured illegal immigrants might number more than 2 million people and that some health care assumptions need to be studied.

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